Thousands of Kenyans are now counting their losses after investing in a business once touted as the perfect opportunity.
A report by Quartz Africa on Tuesday, May 18, indicated that Kenyans had been hooked to a trading technique known as buying the dip in the Bitcoin business.
Buying the dip is when traders wait for the value of bitcoin to go down for them to buy before eventually selling it at a profit when the price increases.
In Kenya, buying the dip has been a successful business since November 2021 when a single bitcoin was valued at as much as Ksh8 million (USD69,000).
At the beginning of February 2022, the bitcoin price dropped to around Ksh4.4 million (USD37,500) which prompted thousands to buy it.
In the first round, the technique worked since at the end of March, the price had jumped back up to Ksh5.5 million.
In April, however, the price dipped prompting thousands to make the purchase but never rebounded. It continued dropping and by the time of press, its value had sunk to Ksh3.6 million.
This is despite efforts by Kenyan businessmen seeking to expand cryptocurrency use across the country as well as abroad. They argue that its transactions are safer and faster.
On Tuesday, the Kenya National Chamber of Commerce and Industry (KNCCI) Nairobi chapter urged the Central Bank of Kenya (CBK) to expedite its process of creating a conducive environment for cryptocurrencies as payments.
KNCCI Chairman, Julius Opiyo, argued that several companies were exploring a new mode of payment.
"The regulatory authority should move faster and see how we could adopt digital currency and secure the business community within the country," he urged CBK.
Kenya is ranked 12th on the list of countries with many holders of cryptocurrencies but it is estimated that over 18,000 coins are likely to lose value due to Bitcoin's dip.
